Limited by Guarantee company formation – Registering not for profit companies
Forming a limited by Guarantee company (not for profit) is similar in many ways to forming a typical limited by shares company.
- The name cannot be the same as one already in existence regardless of whether the company is limited by shares or limited by guarantee
- The company must have at least one director
- An effective registered office address must be declared to Companies House
- A secretary can be appointed if required but is not mandatory
Limited by guarantee companies have several features that are different to limited by shares companies.
- There are no shareholders. No one owns the company for the purpose of making a commercial gain or for extracting profits for their own benefit
- The company has members that act as guarantors instead of shareholders. Instead of a share capital the members guarantee to provide a nominal amount of money in the event that the company is wound up with debts. This is typically set at just £1 per member.
- There are several versions of the Articles of Association that may be suitable for the company. This will depend on whether you wish to include not for profit distribution clauses, register as a charity or simply adopt the guarantee model articles.
- It is possible to omit the word LIMITED from the company name during the registration process. This is only possible when not for profit distribution clauses are included in the articles of association.
For advice and guidance on registering a limited by guarantee company please contact one of our advisors for assistance. We do not currently offer an online application for companies limited by guarantee. We prefer to speak to our not for profit clients to get a better understanding of which articles will be suitable on a case by case basis. This ensures your new company limited by guarantee achieves what you intended. We still form the company within just a few hours once we have clarified with you exactly what you need.
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